Lawsuit filed against ANZ New Zealand over bank penalty fees

A class action lawsuit has been filed against ANZ New Zealand over allegations the bank charges excessive penalty fees for overdrawn accounts and late payment of credit cards.

A lawyer for the claimants, Andrew Hooker, says 13,500 individuals and 1,800 small businesses are taking part in the class action, which was filed in the High Court in Auckland.

Mr Hooker says customers of ANZ New Zealand are charged higher penalty fees than customers of the bank in Australia and deserve compensation.

"We're alleging that the bank's charged unlawful penalty fees for people when they default on their payments or make late payments, and those fees aren't sustainable at law and so therefore they should be refunded," Mr Hooker said.

He says the amount runs into tens of millions of dollars.

ANZ New Zealand argues its penalty fees are fair and says it will vigorously contest the legal action.

But Mr Hooker says a similar case in Australia against ANZ has given the claimants hope.

"The high court of Australia has ruled quite clearly that these sorts of charges are capable of being a penalty," he said.

According to Mr Hooker, Australia's Federal Court will now decide what is a reasonable penalty.

He says the class suit is the first of many planned against other Australian-owned and local banks operating in New Zealand.